For years, people have been breaking down sports mathematically based on the probabilities of various outcomes. It’s a popular topic amongst fans keen to discuss, engage and predict elements of their favourite sport.
Thanks to technology, the ability for bookmakers to serve this interest by providing as many betting markets as possible has become a lot more efficient.
As Artificial Intelligence (AI) continues to revolutionise the industry, many have said that sports trading will transition from being a manual task to a more automated one, perhaps eventually ruling out the need for human sports traders.
But for Sportradar, this means something different. At the foundation of all their products and services is quality – but this isn’t just restricted to their comprehensive sports coverage, data and ISO-certified data procurement processes. Quality and reliability are also applied to their sport trading efforts.
The company has made a commitment to hiring not just traders but sports experts, analysts, scientists and mathematicians who, together, monitor and analyse every sport you can think of, tracking global bets and markets 24/7.
With cutting-edge technology as its base, Sportradar analysts are able to comprehend betting data from over 600 bookmakers worldwide and their comprehensive sports data, which is collected by over 7,000 scouts from more than 400,000 matches annually across 60 sports.
Recently expanding its trading team in London, the Sportradar approach is to pair the very best innovative data-driven models with the very best human expertise to create a truly valuable combination of trading and risk management for clients across the world, as Trading Manager Matthew Trenhaile explains.
“The more data you have access to, the better,” he said. “As a trader, the data is telling you what to do in a sense, in that you’ll look at the data and see what metrics have been predictive historically.
“The data technology is the basis for how we trade, but you need traders with a strong knowledge of a sport and the industry, and the science and mathematics behind it, to be able to know what to expect and either reinforce or adjust where necessary.”
Trading is therefore seen as a specialist function at Sportradar, which is why their most signature solution – as part of a 360-degree betting offer – is their Managed Trading Services (MTS).
Recognising the fact that elements of risk management also can’t be automated by a machine, MTS allows clients to benefit from the cost efficiency of a managed service, whilst utilising Sportradar’s technological models and expert trading team in as flexible manner as they need. It is also used by Sportradar themselves internally to continue enhancing their trading framework.
“Our traders use quantitative models and data from the global odds market to adjust prices and manage risk where required,” Trenhaile continued. “With each new bet we observe, we have a new data point to add to the trading mix. This market feedback loop allows us to identify if there are any issues with our trading and this data is invaluable in helping our Quantitative and AI teams improve our models.
“The models our Quants and AI teams build start out as market agnostic; they don’t take into account the betting market initially in order to avoid bias. Our traders are responsible for the betting market – they are required to evaluate when the market is doing something incorrectly or when the technology is not capturing certain elements that only an expert can see. With the unpredictable nature of sport, this is crucial.
“Technology can’t pick up subjective elements like the weather or player injuries, which affect play, whether before or during a match. The trader is required to translate these elements into an adjustment to the implied probabilities generated by the model. Because if a player gets injured, for example, all of a sudden that changes the probability, potentially, of a team winning because they may not be able to perform as well as what they would normally.
“The model can’t perfectly adjust to this accordingly. As such you need trading analysts to adjust, where required, to ensure that, although the model is saying something, it isn’t in complete contrast to the market. So, again, it’s really important to have traders who understand player tendencies and strengths and other game elements based on their expert intuition and knowledge of the industry and sport.”
The value-add by expert traders for Sportradar then is very much in their ability to both interpret any inaccurate market data and insufficient statistics to adjust the model for a particular scenario. This can also help pick up various changing trends within sport.
“In baseball, for example, some teams have opted for opening pitchers, where a pitcher comes in to pitch just for the opening one or two innings of a game, similar to how a closing pitcher finishes the last few innings of a game,” Trenhaile explained. “Initially when the trader first saw that there would not have necessarily been accurate statistical analysis to support that scenario.
“A player who is brought in specifically to pitch just for the first two innings needs to throw as hard as they can. As such, they’re going to throw faster in a short stint of two innings than what they would if they were kept on for seven innings, for example. In such a case, a trader will need to adjust as there may be less hits for the opening two innings.
“This is where an experienced trader who knows their sport really adds value because, in this situation, no historical data would be able to pick up on it. A trader can spot aspects like this that a machine can’t. And because baseball is so analytics based, changes like this need to be accounted for and adjusted accordingly all the time.”
So, whilst advanced technology like AI can help make sports trading more efficient, there is an additional element to the debate that eventually it may completely replace human sports traders.
As Sportradar attests, having the backup of a team of academically sound sports enthusiasts watching the events as they take place in real time makes for a truly superior service that ensures trading and risk management are sound.